PP Box Raw Material Introduction Series Eight

- Apr 27, 2018-

Polypropylene Market Price Fluctuation


      Polypropylene prices in PP packaging materials in China are very volatile. Since 2007, PP prices have continued to follow the rising trend of crude oil prices until June 2008, when the financial crisis broke out. In 2007 China's annual average price of 12,009 yuan polypropylene / ton, in June 2008, the maximum rose to around 16,800 yuan / ton, or nearly 40%, a large price change is consistent with the trend of crude oil. At that time, the price of PP packaging was also rising. From the fluctuations during the year, the fluctuations were also severe. Affected by the financial crisis, the situation in 2008 was very special. The maximum was 17,000 yuan/ton, and the lowest was 6,400 yuan/ton. The price fluctuation was 10,000 yuan. / Ton, even if the average year price volatility is greater, the price volatility in 2009 is about 47%. In 2012, affected by the large number of new PP installations in China, the volatility dropped to 18%.


Polypropylene and crude oil from 2008 - 2012 YEAR trend, due to the crude oil in the front end of the industrial chain, more sensitive to price, price volatility than some of the more intense polypropylene. However, the trends of the two are basically the same, and the time points of rising and falling are basically consistent.


 From the price trend charts of polypropylene and propylene in the same period from 2008 to 2012, the two can basically achieve the same rise from the point of time. The price difference between the two is about 50 US dollars/ton in the period of stable price. The sharp drop or the rise in the price rise will further reduce the spread. In addition, it is worth noting that since propylene is basically used in the production of polypropylene, the price fluctuation of propylene is more affected by the influence of upstream raw materials and the needs of other related products such as ethylene and refined oil.


Polypropylene and polyethylene come from petroleum, and ethylene (PVC packaging box raw material) and propylene belong to a symbiotic relationship. The price trends of the two are basically the same. The correlation coefficient between 2008 and 2012 is about 0.79.


Analysis of Polypropylene Prices in Domestic Regions


At present, China's plastic spot market has two major distribution and trade concentration areas, one is the Yuyao market in East China, and the second is the Dongguan area in Shunde, South China. In addition, Qilu Chemical City in North China has developed rapidly in recent years, becoming the price center for plastic trading in North China. , But overall, plastic traders in North China are smaller, and the company's PP transparent box raw materials are sourced from the East China market.


      North China-East China spread - According to the statistics of the daily price data for 2012, the average spread between North China and East China is around -159 yuan/ton with a standard deviation of 187.36. The South China-East China spread—data statistics show that the average spread between South China and East China is around RMB 99/ton with a standard deviation of 74.6.